House GOP rises up against Cheney

There was a time when Dick Cheney could turn back a Republican revolt on Capitol Hill.

That time is gone.

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The vice president traveled to Capitol Hill on Tuesday to silence a chorus of GOP complaints about Treasury Secretary Henry Paulson’s $700 billion plan. But House Republicans who walked into a closed-door meeting with Cheney steaming over the plan walked out just as angry, and they described what happened in between as both “a bloodbath” and “an unmitigated disaster.”

Texas Rep. Joe Barton took the unusual step of telling reporters gathered outside the Cannon Caucus Room that he had confronted Cheney “respectfully” about his concerns — a level of dissent Republicans once considered heresy under the Bush administration.

Another lawmaker present — who spoke on the condition of anonymity — said that Cheney, White House chief of staff Joshua Bolten and economic policy adviser Keith Hennessey “were in worse shape when they left than when they came in.”

Cheney’s inability to turn around members of his own party said plenty about how congressional Republicans view the Bush White House these days — but maybe even more about their discomfort with a bailout plan many of them see as an attack on their free market principles.

“It’s a sad fact, but Americans can no longer trust the economic information they are getting from this administration,” South Carolina Sen. Jim DeMint said in a comment posted on Politico’s Arena forum.

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“There is tremendous unease over the federal government assuming the assets that these financial institutions cannot price or manage,” said Alabama Rep. Spencer Bachus, the ranking Republican on the committee drafting the legislation.

It wasn’t clear Tuesday whether Republicans were willing to take responsibility for killing the Paulson plan — but neither were they eager to take responsibility for passing it, either.

Republican leaders are now hoping Democrats load the legislation with unrelated measures that would give them the political cover to oppose it, members and aides said. At the same time, party leaders are using back channels in the business community to gauge member support for a “clean” bill.

Former House Speaker Newt Gingrich (R-Ga.) warned his former colleagues that they would pay a price in November for backing the bailout now — and that John McCain could ride to victory over Barack Obama by persuading voters that the bailout is really the “Obama-Bush plan.” While McCain seemed to move in the other direction Tuesday, Gingrich called the Paulson plan “stupid,” “a really bad idea” and “the kind of corrupt scheme that could have been designed by [Russian Prime Minister] Vladimir Putin.”

Despite the anxieties — and outright anger — expressed during the Republicans’ nearly two-hour exchange with Cheney and the other White House officials, lawmakers remained respectful enough to give the vice president two standing ovations.

Still, a lawmaker present said that Cheney and his team “were the wrong guys” to send to the Hill: “The problem is that they’ve used up a lot of goodwill.”

Hennessey and Bolten — who shares a Goldman Sachs pedigree with Paulson — faced a number of tough questions about why the bailout was necessary, how it would actually work and why this particular plan was the best response to the current crisis, according to notes circulated from the meeting.

Cheney and the others made policy arguments for the proposal instead of political arguments that would help lawmakers explain a vote for the plan to constituents. The meeting was almost an hour old when the vice president told the anxious Republicans, in response to a question, that failure to pass this would result in more foreclosures and cause grave hardship for their constituents.